by Patrick Sills

Created on: December 23, 2008

You've just had an interview and successfully impressed the person responsible for hiring. In fact, you've beat out the competition and been offered a position. The employer scribbles a number on a piece of paper and hands it to you; indicating the yearly salary they have in mind. Before glancing down at the number, you hope that it's big. After all, the bigger the salary; the better, right? Well, maybe and maybe not. Wait a minute. How can this be?

It depends on how many hours you will be expected to work in a day, in a week, in a month, and ultimately, in a year. Let's suppose that you are offered a $50,000 annual salary. The normal work week is 40 hours in length; or 5 days of 8-hour shifts. Since this is average, most of us will dedicate this amount of time to our job. Because of this, it becomes quite easy to calculate an hourly pay rate from a given salary. Put simply, and provided you work the customary 40 hours each week, you can figure this in one of two ways: After subtracting out the standard two weeks of vacation we all need to maintain our sanity, this leaves 50 weeks x 40 hours; or 2000 hours a year. Take your yearly salary and divide by 2000. Another way to convert this is to divide your salary by 2, and then move the decimal point 3 places to the left. Either way, this will reveal how much you make each hour on the clock. In reverse, you can think of it this way: if you work 40 hours a week, every 50 cents you make per hour is $1000 per year. Therefore, in the above example, $50,000 a year = $25.00 an hour.

But what if you are expected to put in 50 hours each week? How about 60? Then your hourly rate goes down. That's not such a great deal, is it? This especially rings true if you value time with your family; or for that matter, your well-being. Your best interests must be carefully considered here. Conversely, if your work week is shorter; say 30 or 35 hours, your hourly rate is increased.

In either case, whether you work more or less than the typical 40 hours, the math required to convert your salary to an hourly wage becomes more complicated. Suppose you have to work 50 hours each week to get that $50,000 salary. This would be calculated as follows: 50 hours X 50 weeks = 2500 hours. 50,000/2500 = $20.00 per hour. Now assume that you only work 35 hours each week for that $50,000. 35 x 50 = 1750 hours. 50,000/1750 = $28.57. As you can see, there is a huge difference in hourly pay that is dependent on just how much time you spend working each week.

Some will undoubtedly argue that more money is more money; period. While this is certainly true in the literal sense, it becomes imperative to ask this question:

How much is my time worth?

Learn more about this author, Patrick Sills.
Click here to send this author comments or questions.